One of the advantages of Administration Orders is that none your creditors will be able to pursue you for the debt without first seeking leave to do so through the court. All debt collections agencies will cease to contact you, however an Administration Order will only work if you pay the agreed monthly payment to the court.

There are certain conditions that need to be met before you can apply for an Administration Order, firstly you must have at least one County Court Judgement, owe money to at least two creditors, and have debts of less than £5000.

If the debts are in joint names both parties will need to make separate Administration Orders at the same time. The debts can also be shared equally between both parties. It is important that you include all of your creditors and that you have up to date information for all outstanding balances.

Once the Administration Order form has been completed the court will not require a fee but will deduct 10% of the money you pay to them. Your creditors will then be paid on a pro rata basis. If you experience difficulties paying the agreed monthly amount it is important that you contact the court straight away. If this is due to a change of circumstances they may agree to reduce the payments to help maintain the Administration Order.

Failure to keep to the agreed payment term and not contacting the court to inform them of a change of circumstances can result in the Administration Order being revoked; this will then allow your creditors to pursue you for the outstanding debts.